For many agencies, the typical annual performance review process will try to accomplish too much. In a formal review meeting, managers will attempt to review 12 months of an individual’s performance AND their compensation AND to provide guidance on professional development planning. That’s quite a lot to cover in a 30-60 minute discussion. I’d also like to point out that the order of those three priorities is wrong for what your agency and people need in today’s environment. So rather than using this traditional approach to address them all, we can be more intentional about each.
- Performance reviews can and should be done in near-real-time, whenever someone observes an issue.
- Compensation reviews can and should occur on their own whenever appropriate.
- Your people can then focus their time and energy on a professional development program dedicated to helping your people achieve their full potential within your agency instead of on a flawed traditional performance review process.
If we look at Maslow’s Hierarchy of Needs applied to the work environment, this approach aligns with the top of the pyramid and can significantly increase employee engagement and growth.
Why Traditional Annual Performance Reviews Do Not Work As Intended and How To Shift Your Thinking
1. Rating people is flawed.
- Humans are poor raters of other people’s performance.
- We are inconsistent in our assessments (we are unknowingly biased and challenged to remain objective, we can’t “see” the events that may have impacted one’s performance, etc.). Check out the book Nine Lies About Work for various studies and this HBR article for additional data.
- Humans are, however, accurate reporters of our own experiences.
Proposed shift: Change the focus from assessing others to helping others reflect on their experiences, what they want to achieve, the outcomes they’re meant to produce, and what they can do to get there.
2. Yearly timing is ineffective.
Other research tells us that:
- Managers can’t typically “judge” an entire year of work from an individual at one time.
- Employees need and want regular feedback. Daily or weekly coaching is key to consistent alignment and performance.
- Employees (and your agency) will benefit faster when they receive real-time or near-real-time performance feedback, not at the end of the year.
- Setting quarterly performance goals with employees can generate 31% greater returns than those who do it annually. Doing this monthly produces even better results.
Proposed shift: Create a program that promotes regular feedback and coaching with milestones or check-ins.
3. The type of feedback typically prompted can hinder engagement and motivation.
- Traditional reviews typically issue a number rating to represent someone’s performance, which can feel cold and impersonal.
- Positive, constructive feedback is much more inspiring and motivating.
- The most valuable part of a review for employees is often the future-thinking “development planning” conversation.
Proposed shift: Prioritize the focus on future growth and development.
4. Traditional programs are costly in terms of time and effort vs. their ROI.
- Documentation, administration, and meeting time adds up quickly, often with little measurable gains in employee and company performance to show for it.
Proposed shift: Design a lightweight program that fosters regular alignment, coaching opportunities, passion for work and engagement, and ongoing employee development.
The Purpose of a Professional Development Program
The purpose of a professional development plan should be to foster individual professional growth to help your people learn, grow and do the best work of their lives.
Principles for Designing a Professional Development Program
To help you design a modern professional development program, let the following set of principles guide your thinking:
1. It should be simple.
2. It should not be something that is “done to employees” but rather “done for employees.”
- Individuals can drive the type of feedback they receive.
- Individuals can drive the frequency of feedback.
- Individuals can select the person(s) giving the feedback.
- The person receiving the feedback decides what they will do with the input.
3. It should be “people-positive.”
- It fosters stronger relationships (doesn’t create a competitive environment)
- It’s personalized (it’s focused on supporting how the person wants to grow)
4. It should align with your company values.
5. It should support the overall design of the “employee experience” that you intend to create.
Outcomes To Aim For As You Design Your Program
- You build trust between employees, managers, and leadership.
- Employees feel they are doing meaningful work.
- Employees gain insight into how to be productive and effective.
- Employees have an opportunity to grow and learn.
- Employees feel the experience is valuable.
Metrics You Can Use To Improve Your Professional Development Program
- Qualitative feedback from employees and managers about how well the program fulfills its purpose and adheres to the intended principles.
- The number of people who create a professional development plan.
- The number of people who complete their professional development plan.
What To Do Next
Of course, not all annual performance review programs are ineffective. I recommend assessing your current program to learn which aspects have been most valuable to your employees. Route those learnings into your planning using the principles I shared earlier and start to reimagine what professional development planning could look like at your agency.